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Rebranding of a business today transcends industry, company size, and history. Costs associated with relaunching a logo or overhauling an image alone run into the millions and when there's controversy involved, the collateral damage can be even worse.

Hedge fund SAC Capital Advisors, which in its prime oversaw $15 billion in assets under management, is now in that boat, mired in an alleged insider trading scheme surrounding a pair of portfolio managers at the firm. According to the SEC, the asset management firm allegedly profited and avoided losses of $275 million plus as a result of insider trading, and the money managers received millions in bonuses as a result of their performance.

Not surprisingly, SAC Capital wants to change its name in the wake of the controversy, and in the process attempt to alter public opinion on the firm's reputation. Last month, the hedge fund conceded to pay the government $1.2 billion in a settlement. That's on top of the more than $600 million it agreed to pay the SEC.

Any publicity is good publicity, right?Fifty-seven year old Steven A. Cohen, founder of the firm that bears his initials, has his work cut out for him. Even with the best of corporate governance, asset managers have to prove themselves to investors time and time again; after all, those folks are investing in that individual trader or money manager as much as they are the brand. And this phenomenon is precisely what threatens to be Cohen's undoing.

To be clear, SAC Capital will not be taking outside capital for a while, instead scaling back to become a family office and limiting the investment activity to Cohen's own capital, similar to the way Julian Robertson ran his hedge fund after the tech bubble burst. Hedge fund managers, however, are an often brazen breed that don't give up easily, and there's no telling when Cohen may decide he wants to invest clients' money again. In fact, this may already be the plan.

But in an environment where even the good guys can never take their clients' trust for granted, could SAC Capital, even with a makeover, attract investors' capital once again?

Good fellasBlackRock (NYSE: BLK) is one of those "good guys," says Reputation Institute. Indeed even with a sterling reputation, one that is underscored in the retention of the firm by governments around the world, BlackRock knows how to capitalize not only on economic uncertainty but also the competition's weaknesses.

For example, in 2012, just as JPMorgan Chase (NYSE: JPM) was caught up in the London Whale trading fiasco and Goldman Sachs (NYSE: GS) was suffering the defection of a top exec via a scathing letter penned to The New York Times, BlackRock launched this marketing campaign:

Today's markets are as uncertain as ever. But there is one certainty—that the future is coming. It's no longer enough to simply preserve what you have today; you have to build what you will need for tomorrow. And you can't wait until tomorrow to do so. It's time to be an investor again.

And with the strength that the markets have been exhibiting, it looks like it's time to be an investor again in 2014 as well. But while SAC Capital is unwinding its positions and returning capital to shareholders, what can it expect as it contemplates changing its brand?

Martha's moment

Let's take a look at Martha Stewart Living Omnimedia (NYSE: MSO) for some guidance. There are obvious differences -- for example, Stewart was never seen as a steward for other people's money, and unlike Stewart in her insider trading case, Cohen himself was not charged (although SAC trader Michael Steinberg on Dec. 18 was convicted of insider trading.)

But both Cohen and Stewart turned to the same crisis public relations firm, Sard Verbinnen, which, speaking to the nature of the scandals, casts a similar shadow over the pair.

At the height of Stewart's scandal, she was spending nearly $2 million per month in public relations and legal advice, according to Reputation Institute. Martha Stewart the company swung from being a profitable business to reporting a loss, and the stock price was halved.

SAC Capital isn't publicly traded, but it profited from the hefty management and performance fees it charged clients. Now the hedge fund firm is shuttering its London office and renting out or subletting its Madison Avenue office space in New York as it scales back operations. The size of the work force, which once stood at 1,000 strong, has been slashed and the remaining employees aren't secure about their future.

ConclusionSAC Capital is losing vast sums -- returning capital and paying fees to make things right. But something that can't be wiped out is any damage -- direct or indirect -- to the asset manager's reputation. Whether Cohen will retain the trust of investors remains to be seen.

When you examine SAC Capital's performance, the hedge fund was up $4 billion in gross profit through the first 10 months of the year, according to The New York Times. That might help to lessen the sting for some...most certainly for Cohen.

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